White Rock remains nimble despite subdued environment
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
Global mining group, White Rock Minerals Ltd (ASX:WRM) has provided an update in response to the COVID-19 pandemic, outlining the company’s various options in terms of progressing with exploration in the near to medium-term.
While confirming that the safety and wellbeing of staff and contractors is management’s highest priority, there are a number of initiatives that have been taken to ensure the company’s stability, preserve its balance sheet and maintain a level of preparedness for a return to business as usual.
In terms of minimising potential exposure to COVID-19, management has instigated Federal and State Governments regulations and recommendations with all non-essential travel and non-essential face-to-face meetings cancelled, working from home implemented where possible and virtual/online communications enacted.
White Rock had already closed its corporate office in Ballarat over a year ago and its staff and management are well adapted to working remotely across many time zones, including Melbourne, Perth, London and Alaska.
With the very considerable uncertainty around activities due to the COVID-19 crisis, including increased tightness in funding for junior exploration companies, managing director Matthew Gill advised that a number of cost saving initiatives had also been implemented to preserve cash reserves while still allowing work to continue on developing strategies to advance the company’s two assets.
As part of these measures, directors and management, including administration contractors, have agreed to an across the board 30% cut in fees effective immediately.
Given that the duration of the current market conditions is unknown, White Rock will be continuously reviewing its cost base and considering ways to maximise the value of the Mt Carrington gold/silver project and the Red Mountain VMS and Gold Project in Alaska.
It is worth taking a look at both projects, particularly given that they are in different geographic regions and may have the capacity to progress at varying levels during and after COVID-19.
White Rock maintains field camp at Red Mountain
The company completed its 2019 field season at Red Mountain in October and demobilised from site prior to the commencement of winter in Alaska.
Management is investigating what opportunities there might be to conduct a focused exploration and drill program, testing the large, robust and potentially significant gold anomaly discovery called Last Chance, announced in January.
The newly defined Last Chance gold prospect is located within the Tintina Gold Province, host to giant gold deposits including Donlin Creek (45 million ounces), Pogo (10 million ounces) and Fort Knox (13.5 million ounces), which are all Intrusion Related Gold System (“IRGS”) style of mineralisation.
In addition, the final drill hole from the 2019 field campaign, a 200-metre plus down-dip step out at the Dry Creek VMS deposit, suggests considerable potential for the Mineral Resource to grow in size and tonnage along its entire 1,200 metre strike length.
Currently, management has not planned to conduct any 2020 field activities, but pending Local Government guidelines related to COVID-19, it feels well placed to implement a field program given the location of the project and the company’s reliance on local Alaskan consultants and contractors.
White Rock has maintained a field camp with a drill rig remaining on site and available to test both the Last Chance gold target and extensions to the Mineral Resource at Dry Creek, through a controlled program that meets stringent safety and wellbeing requirements should the COVID-19 pandemic remain through 2020.
Mt Carrington Project’s advanced stage could be beneficial
White Rock’s Mt Carrington Project is an advanced gold and silver project in Australia with JORC 2012 Mineral Resources for the gold (341,000 ounces) and silver (23.2 million ounces), a JORC 2012 Ore Reserve and a Pre-Feasibility Study (PFS) for the gold.
The gold pits are separate to the silver pits and are pre-stripped.
This combined with the considerable existing infrastructure including tailings storage facility positions the project to be brought on stream relatively quickly.
The prefeasibility study (PFS) financial metrics for this project are robust, especially in this strong gold price environment, demonstrating a capital payback of less than 1 year, an internal rate of return (IRR) greater than 80% and free cash flow generated from the gold over its first 4 years of greater than $90 million.
White Rock is in discussions with various parties about the project, and management is also conducting a strategic review of Mt Carrington in light of the very strong gold price.
Still bullish on gold price and ready for the green light
Summing up the group’s position and management’s strategy, Gill said, “For the areas that we can control, we are focused on continuing to deliver value for our shareholders.
‘’As an exploration company, we understand what it is like to operate in uncertain times with uncertain outcomes.
‘’Work is still progressing and we are prepared to come out the other side in a strong position within a good industry sector and able to take advantage of any opportunities that may arise.
‘’Our view on the gold sector remains bullish and there will be a flight to quality by investors seeking a secure investment at a time of low interest rates.
‘’White Rock Minerals believes it will meet those criteria.
‘’We need to be in a position to hit the ground running and present ourselves as an investment of choice once market conditions improve.
“I can reassure you that the Board is heavily committed to ensuring that we get the best possible outcome for shareholders and work is not slowing, notwithstanding any potential issues that may arise from the pandemic.
‘’The company’s fundamentals are sound, the outlook for gold appears very strong and we are in a reasonable cash position.’’
General Information Only
S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.